Consumer Power Report #222

Published May 21, 2010

Spring has finally come to Washington, DC — and I hope Greg is enjoying it, because he’s off this week.

I was troubled to read this article in The Wall Street Journal regarding the in-home care casualties of the Medicaid cutbacks. Despite the fact that this kind of coverage is generally less expensive than care offered within facilities, it’s a lot easier to make cutbacks for the disabled who are receiving in-home visits than close down facilities.

I recently had a friend whose disabled grandfather, a World War II vet, had his home care cut off. The administrator who came by to explain why told his grandmother that the vet had been on home health care too long, because they “didn’t expect him to live that long.” How inconsiderate of him!

In this case, their physician, a respected local citizen, intervened with the right bureaucrat to get the services restored. On the one hand, I’m happy for my friend’s grandfather, who has no desire to move into a facility — but on the other hand, this is an illustration of all that’s bad about government-run health care, where solving problems depends on “who you know,” as if you were navigating corrupt bureaucracies in Soviet Russia.

The troublesome reality for states facing the prospect of adapting to our new health care reality under President Barack Obama’s law is a massively increased burden when it comes to state budgets. Expect more and more stories of woe from normal citizens, let down by Washington leadership who possessed neither the will nor the wisdom to solve the problems of American health care.

— Ben Domenech



You may have seen our Health Care News footage of Donald Berwick last week on television, but if you missed it, you can find it here. Dr. Berwick is Obama’s nominee to head the Centers for Medicare and Medicaid Services, essentially the world’s second-largest insurance company, and he is a cheerleader for government-run health care and rationing, particularly when describing his love affair with Britain’s National Health Service. As we noted in Health Care News:

“Key to understanding Berwick’s views on the NHS is a speech he gave as part of a presentation offered two years ago, in which he shared his thoughts on the NHS and health care generally. He decries private-sector solutions to health care problems, dismissing the ‘invisible hand of the market’ as an ‘unaccountable system.’ He also states: ‘I am romantic about the NHS; I love it. All I need to do to rediscover the romance is to look at health care in my own country.’ And more disturbingly, ‘Any health care funding plan that is just, equitable, civilized, and humane must, must redistribute wealth from the richer among us to the poorer and the less fortunate. Excellent health care is by definition redistributional.'” Expect more on this from HCN in the weeks ahead.

Source: Health Care News


USA Today had a fantastic piece this week about the big emergency room myth. You’ve doubtless heard about how a big cost-driver from the uninsured community is their overuse, compared to other populations, of emergency rooms across the country. But according to a new CDC report, that’s just not the case: “The key findings: ER visits by the uninsured were no more likely to be triaged as non-urgent than visits by privately insured patients or those with Medicaid coverage. Older adults, African-Americans, poor people and those on Medicaid were more likely to have had at least one visit in a 12-month period than others. Medicaid-covered patients were more likely to have multiple visits in a 12-month period than privately insured and uninsured patients. People with and without a usual source of medical care were equally likely to have had one or more ER visits in one year.”

Source: USA Today; CDC Report


When the push began for health care reform, the president purposefully cited the need to help American small businesses, struggling with the high costs of coverage for their employees. But now that the legislation is passed, those small business owners are finding it nowhere near as helpful as they’d hoped.

Take this example: “Zach Hoffman was confident his small business would qualify for a new tax cut in President Barack Obama’s health care overhaul law. But when he ran the numbers, Hoffman discovered that his office furniture company wouldn’t get any assistance with the $79,200 it pays annually in premiums for its 24 employees. ‘It leaves you with this feeling of a bait-and-switch,’ he said. When the administration unveiled the small business tax credit earlier this week, officials touted its ‘broad eligibility’ for companies with fewer than 25 workers and average annual wages under $50,000 that provide health coverage. Hoffman’s workers earn an average of $35,000 a year, which makes it all the more difficult to understand why his company didn’t qualify. Lost in the fine print: The credit drops off sharply once a company gets above 10 workers and $25,000 average annual wages.”

Source: Real Clear Politics


Get used to stories like these in the coming months as reimbursement rates and new regulations make Medicare even less attractive:

“Texas doctors are opting out of Medicare at alarming rates, frustrated by reimbursement cuts they say make participation in government-funded care of seniors unaffordable. Two years after a survey found nearly half of Texas doctors weren’t taking some new Medicare patients, new data shows 100 to 200 a year are now ending all involvement with the program. Before 2007, the number of doctors opting out averaged less than a handful a year. ‘This new data shows the Medicare system is beginning to implode,’ said Dr. Susan Bailey, president of the Texas Medical Association. ‘If Congress doesn’t fix Medicare soon, there’ll be more and more doctors dropping out and Congress’ promise to provide medical care to seniors will be broken.'”

Source: Houston Chronicle


As a newlywed myself, I have serious doubts that anyone will say “Honey, I can’t get married — the health benefits don’t make sense” to his significant other. But that’s what the government is incentivizing, according to Kathryn Nix: “The subsidy system erected in the complicated new health law manages to create a brand new ‘marriage penalty.’ Under the law, individuals who earn between 133 and 400 percent of the federal poverty level and can’t get health coverage through their employers qualify for generous subsidies to buy insurance in the government-run exchanges. These subsidies decrease with need, so the more you make, the less you get. But, as Diana Furchtgott-Roth of the Hudson Institute recently remarked, the subsidies are structured so that two people can get more government as singles rather than as a married couple.”

Source: Heritage Foundation


Sara Burrows of the Carolina Journal reports on the unexpected ramifications of the Food and Drug Administration’s war on salt. Potential casualties? Ham and bacon. Yes, we’re serious:

“Cansler said the salt content of the average country ham is between 5 percent and 8 percent. She said setting a maximum of 6 percent or 7 percent would not be impossible, but it would impose costs and complications on producers. … The longer a country ham ages, the saltier it gets, she explained. It would not be difficult to apply an upper salt limit to hams produced and sold locally, but a ceiling could complicate the production of hams targeted for export or import. And an upper limit would restrict certain producers that use aging as a way to distinguish their hams from their competitors. … It’s also unclear how the FDA would treat bacon, another pork product heavily reliant on salt.”

If the FDA indeed mandates maximum amounts of sodium per serving in food categories such as bacon, it could effectively eliminate the ability to produce pre-packaged bacon products, since it requires salt to be cured. Do the food police know no limits?

Source: New Ledger